NEW YORK: US stocks pared gains to trade slightly up in early afternoon trading on Friday, with the Dow on track to close higher for the ninth straight day after data showed US employers hired more workers than expected in July.

The Labour Department report showed nonfarm payrolls increased by 209,000 jobs last month, above the 183,000 rise expected by economists polled by Reuters.

June’s employment gain was revised up to 231,000 from the previously reported 222,000.

Average hourly earnings rose 0.3 percent after gaining 0.2 percent in June, while the unemployment rate fell to 4.3 percent.

The strong jobs report is likely to clear the way for the Federal Reserve to announce a plan to start shrinking its $4.5 trillion bond portfolio in September, and could strengthen its case to raise rates for the third time this year in December.

Chances of a rate hike by the end of the year increased to 50 percent from 46 percent after the release of the data, according to CME Group’s FedWatch tool.

“It’s encouraging to see average hourly earnings come in line after falling the previous month,” said Eric Wiegand, senior portfolio manager at US Bank Private Client Reserve.

At 12:42 p.m. ET (1642 GMT), the Dow Jones Industrial Average was up 30.64 points, or 0.14 percent, at 22,056.74 and the S&P 500 was up 2.52 points, or 0.10 percent, at 2,474.68.

The Nasdaq Composite was up 3.21 points, or 0.05 percent, at 6,343.55.

Five of the 11 major S&P sectors were higher, with the financial index’s 0.88 percent rise leading the advancers.—Reuters